VA gets hike in new budget

The Department of Veterans Affairs scores a 4 percent funding hike in President Obama's budget as the agency struggles to deal with a burgeoning backlog in benefits claims.

White House chief of staff Denis McDonough told reporters Friday that the president is proposing $2.5 billion for the Veterans Benefits Administration to help clear the backlog, the Washington Post reports.

“The president has made clear to us this is a national priority,” McDonough said.

The backlog has prompted bitter complaints from veterans groups and even some calls for Veterans Affairs Secretary Eric Shinseki to resign.

Seventy percent of the 885,000 applications pending for veterans benefits have been waiting for more than 125 days, the Post reports. The backlog when Obama took office was 391,000 applications.

Obama's budget will also include nearly $300 million to digitize disability claims and $7 billion for mental health services -- a 7 percent increase, the New York Times reports. Overall, the proposed VA budget is $63.5 billion.

McDonough and White House economic adviser Gene Sperling also announced that the budget would make two tax credits for hiring veterans permanent. The Returning Heroes Tax Credit gives companies a tax break of up to $5,600 for hiring long-term unemployed veterans, and the Wounded Warrior Tax Credit provides credits of up to $9,600 for hiring long-term unemployed veterans who were disabled while serving. Those credits are due to expire at the end of 2013.

"[F]or veterans of the post-9/11 generation, many returning to the civilian workforce at a time when our economy, while making progress, is still healing from the Great Recession, too many American heroes are struggling to find work," McDonough and Sperling write in a post on the White House web site.